Shannon Company segments its income statement into its North and South Divisions. The company's overall sales, contribution margin ratio, and net operating income are $780,000, 46%, and $15,600, respectively. The North Division's contribution margin and contribution margin ratio are $140,000 and 50%, respectively. The South Division's segment margin is $90,000. The company has $140,400 of common fixed expenses that cannot be traced to either division. Required: Prepare an income statement for Shannon Company that uses the contribution format and is segmented by divisions. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. Note: Round your percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3). Sales Variable expenses Contribution margin Traceable fixed expenses Territorial segment margin Common fixed expenses. wwwwwwwwww Net operating income Y Total Company Amount % Amount North % Divisions Amount South %

Shannon Company segments its income statement into its North and South Divisions. The company's overall sales, contribution margin ratio, and net operating income are $780,000, 46%, and $15,600, respectively. The North Division's contribution margin and contribution margin ratio are $140,000 and 50%, respectively. The South Division's segment margin is $90,000. The company has $140,400 of common fixed expenses that cannot be traced to either division. Required: Prepare an income statement for Shannon Company that uses the contribution format and is segmented by divisions. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. Note: Round your percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3). Sales Variable expenses Contribution margin Traceable fixed expenses Territorial segment margin Common fixed expenses. wwwwwwwwww Net operating income Y Total Company Amount % Amount North % Divisions Amount South %

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 13E: The condensed income statement for the Consumer Products Division of Tri-State Industries Inc. is as...

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Company A has current sales of $4,000,000 and a 45% contribution margin. Its fixed costs are $600,000. Company B is a service firm with current service revenue of $2,800,000 and a 15% contribution margin. Company Bs fixed costs are $375,000. Compute the degree of operating leverage for both companies. Which company will benefit most from a 15% increase in sales? Explain why.
The condensed income statement for the Consumer Products Division of Tri-State Industries Inc. is as follows (assuming no support department allocations): The manager of the Consumer Products Division is considering ways to increase the return on investment. a. Using the DuPont formula for return on investment, determine the profit margin, investment turnover, and return on investment of the Consumer Products Division, assuming that 143,750,000 of assets have been invested in the Consumer Products Division. b. If expenses could be reduced by 3,450,000 without decreasing sales, what would be the impact on the profit margin, investment turnover, and return on investment for the Consumer Products Division?
Columbia Products Inc. has two divisions, Salem and Seaside. For the month ended March 31, Salem had sales and variable costs of 500,000 and 225,000, respectively, and Seaside had sales and variable costs of 800,000 and 475,000, respectively. Salem had direct fixed production and administrative expenses of 60,000 and 35,000, respectively, and Seaside had direct fixed production and administrative expenses of 80,000 and 45,000, respectively. Fixed costs that were common to both divisions and couldnt be allocated to the divisions in any meaningful way were selling, 33,000, and administration, 27,000. Prepare a segmented income statement by division for March.
Forchen, Inc., provided the following information for two of its divisions for last year: Required: 1. For the Small Appliances Division, calculate: a. Average operating assets b. Margin c. Turnover d. Return on investment (ROI) 2. For the Cleaning Products Division, calculate: a. Average operating assets b. Margin c. Turnover d. Return on investment (ROI) 3. What if operating income for the Small Appliances Division was 2,000,000? How would that affect average operating assets? Margin? Turnover? ROI? Calculate any changed ratios (round to four significant digits).
Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. Wood used to produce desks ($125,00 per desk) Production labor used to produce desks ($15 per hour) Production supervisor salary ($45,000 per year) Depreciation on factory equipment ($60,000 per year) Selling and administrative expenses ($45,000 per year) Rent on corporate office ($44,000 per year) Nails, glue, and other materials required to produce desks (varies per desk) Utilities expenses for production facility Sales staff commission (5% of gross sales)
Materials used by the Instrument Division of Ziegler Inc. are currently purchased from outside suppliers at a cost of 1,350 per unit. However, the same materials are available from the Components Division. The Components Division has unused capacity and can produce the materials needed by the Instrument Division at a variable cost of 900 per unit. a. If a transfer price of 1,000 per unit is established and 75,000 units of materials are transferred, with no reduction in the Components Divisions current sales, how much would Ziegler Inc.s total operating income increase? b. How much would the Instrument Divisions operating income increase? c. How much would the Components Divisions operating income increase?
Shannon Company segments its income statement into its North and South Divisions. The company’s overall sales, contribution margin ratio, and net operating income are $480,000, 36%, and $9,600, respectively. The North Division’s contribution margin and contribution margin ratio are $92,000 and 40%, respectively. The South Division’s segment margin is $32,500. The company has $62,400 of common fixed expenses that cannot be traced to either division. Required: Prepare an income statement for Shannon Company that uses the contribution format and is segmented by divisions. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. (Round your percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3).)
Shannon Company segments its income statement into its North and South Divisions. The company’s overall sales, contribution margin ratio, and net operating income are $790,000, 48%, and $15,800, respectively. The North Division’s contribution margin and contribution margin ratio are $150,800 and 52%, respectively. The South Division’s segment margin is $95,000. The company has $150,100 of common fixed expenses that cannot be traced to either division. Prepare an income statement for Shannon Company that uses the contribution format and is segmented by divisions. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales. (Round your percentage answers to 1 decimal place (i.e .1234 should be entered as 12.3).)
Michaels Company segments its income statement into its East and West Divisions. The company’s overall sales, contribution margin ratio, and net operating income are $600,000, 50%, and $50,000, respectively. The West Division’s contribution margin and contribution margin ratio are $150,000 and 75%, respectively. The East Division’s segment margin is $70,000. The company has $60,000 of common fixed costs that cannot be traced to either division. Required: Prepare an income statement for Michaels Company that uses the contribution format and is segmented by divisions. In addition, for the company as a whole and for each segment, show each item on the segmented income statements as a percent of sales.
Samsun company operates with two divisions, sam and sun. The results of the operations last year showed the company earning a net operating income of P468,000 while allocating P1,040,000 ccommon fixed expenses. The contribution margin of Sam was P780,000 while contribution margin ratio for sun ws 40%. Sun was able to generate sales of P3,250,000, and its segment margin was P832,000. The segment margin for sam was: A. P676,000 B. 1,508,000 C. P208,000 D. P832,000
Chao, Incorporated, a service provider, has two divisions. The firm’s most recent annual contribution format segmented income statement appears below. Total Company Eastern Division Western Division Sales $ 450,000 $ 90,000 $ 360,000 Variable expenses 243,000 27,000 216,000 Contribution margin 207,000 63,000 144,000 Traceable fixed expenses 100,800 46,800 54,000 Division segment margin 106,200 $ 16,200 $ 90,000 Common fixed expenses 72,000 Net operating income $ 34,200 If the company eliminates the Western Division and the Eastern Division sales increase by 10% as a result, how much will the company’s net operating income decrease? multiple choice $83,700 $88,380 $90,000 $137,700 $144,000
Eevee Company consists of 2 divisions, Sylveon and Glaceon. Eevee Company reported a contribution margin of ₱70,000 for Sylveon Division and had a contribution margin ratio of 30% in Glaceon Division. Sales in Glaceon Division were ₱300,000. Net operating income for the company was ₱45,000 and traceable fixed expenses were ₱60,000. Eevee Company's common fixed expenses were ₱___________.